Facebook IPO cash influx could spark flurry of weddings and divorces
Divorce lawyers and wedding planners have been gearing up for the Facebook IPO, waiting for the influx of wealth in Silicon Valley to stir up drama in romantic relationships, for better and for worse.
"When Google went public, there was a wave of divorces. When Cisco went public there was a wave of divorces," says Steve Cone, a divorce attorney based in Palo Alto, near the social network's Menlo Park headquarters. "I expect a similar wave shortly after Facebook goes public."
The Facebook IPO will mint hundreds of new millionaires, some billionaires, once employees are allowed to sell their shares after the six-month lock-up period, funnelling cash to all parts of the local Silicon Valley economy.
Personal wealth managers have been courting the soon-to-be-mega rich. Real estate agents have been knocking on doors in cities near Facebook's office complex, according to some local residents, offering to buy them out in order to flip the houses to Facebook employees.
The median sale price for houses in Palo Alto, for example, has gone up 31.5 per cent in the last year, according to Trulia, a property search site.
Taking a less aggressive approach, but still hopeful the financial benefits of the float will trickle down to them, are the professionals that guide couples through divorce proceedings and the massive wedding industry.
"A lot of people who work at Facebook are in their 20s and 30s," says Sophie Lai, a wedding planner based in Sunnyvale. "I hope, at the IPO, people get cash and start thinking 'it's time to settle down and get married'."
Jean Marks, a wedding planner in Palo Alto, said the budgets people have been willing to set for weddings have been going up, particularly among technology entrepreneurs who sell their start-ups.
"We have had a bubble of fairly extravagant weddings in last five years," she says.
At the high end, Ms. Marks has worked on weddings costing between $300,000 and $500,000 (U.S.), with one financier hosting a $1-million reception. The average wedding costs between $65,000 and $75,000 for 150 people, she says.
At the same time that a windfall can make couples feel ready to tie the knot, it can also give unhappy couples the confidence and financial stability to split. Or, as newly minted millionaires wrestle with the responsibility that money brings, some get frazzled and difficult to be around, while others develop a sense of entitlement that leaves them discontent in their relationship.
"There's this feeling that they can have it all," says Nicole Baras Feuer, co-director of the Start Over Smart divorce expo in New York. "They can trade in a spouse and have something better."